Merging Platform Ecosystems in Technology Acquisitions: a Governance Perspective

This paper investigates the issue of merging third-party ecosystems in corporate acquisitions to access innovative technologies and related capabilities. Extant explanations for how technology acquisitions create value are limited to the analysis of the internal capabilities and structures of the merging companies. Given the increasing importance of platforms and value co-creation with third-party providers for companies making technology acquisitions, we complement existing literature by reframing the analysis of technology acquisitions to include the merger of the broader partner ecosystems. Specifically, we draw on theories of ecosystem governance to analyze how ecosystem tensions unfolded during the ecosystem merger and how the acquirer governed these tensions in SAP SE’s acquisition of the e-commerce provider Hybris AG. Our findings suggest that the governance of ecosystem tensions is an important aspect of managing technology acquisitions. We identify the pre-acquisition relation between the acquired company’s ecosystem partners and the acquirer as an important context factor for explaining how a partner company is exposed to the ecosystem tensions during the merger.